On April 23, 1998, the last croupier locked the doors of the Christmas Island Casino, and half the island's population left with them. The resort at Waterfall Bay had operated for barely five years, yet its closure halved Christmas Island's population from roughly 2,600 to 1,300 people. A 156-room complex with 43 slot machines and 23 gambling tables, it had been designed to lure high rollers from Southeast Asia to one of the most remote inhabited places on Earth -- an Australian territory floating in the Indian Ocean, closer to Jakarta than to Perth. The Asian financial crisis of 1997 destroyed that business model overnight, and what remains is a 47-hectare ghost resort that has spent more years empty than occupied.
The logic was counterintuitive but compelling: Christmas Island's remoteness was the selling point, not the obstacle. Sitting 380 kilometers south of Java and 1,600 kilometers northwest of the Australian mainland, the island offered something no casino in Singapore or Macau could -- genuine seclusion on sovereign Australian territory, wrapped in tropical jungle and Indian Ocean breakers. A 99-year crown lease was issued in 1989, and by 1993 the Christmas Island Resort was open for business. The complex sprawled across the northeastern coastal terraces at Waterfall Bay, not far from the island's airport. Beyond the 156 guest rooms and suites, the resort operated restaurants, nightclubs, and a swimming pool. The company also owned the 80-room Christmas Island Lodge in nearby Poon Saan and maintained 144 apartments for staff. For a tiny island whose economy had long depended on phosphate mining, the resort represented a radical reinvention.
The resort never found steady financial footing even in its best years, and the Asian financial crisis of 1997 delivered the blow it could not survive. When the doors closed in April 1998, between 200 and 250 employees left the island. The demographic impact was staggering -- in an isolated community of 2,600, losing that many workers and their families meant losing nearly half the population within three years. The economic disruption rippled through every business on the island. What had been built as a catalyst for growth became a cautionary tale about the vulnerability of small island economies tied to a single industry. The mothballed resort sat empty, its nightclubs silent, its pool drained, its gaming tables gathering dust behind locked doors.
Closure did not end the resort's story -- it merely shifted the genre from business venture to political controversy. In 2002, the ABC investigative program Four Corners raised allegations of money laundering at the casino during its operating years. That same year, the Australian government leased one of the resort's kitchens for an entirely different purpose: preparing meals for asylum seekers detained on the island. The irony was hard to miss. A complex built to pamper wealthy gamblers was now feeding people held behind fences. The island's Shire President, Gordon Thomson, argued that the government should hand the resort to the Christmas Island community to operate as a tourist facility. Instead, the building was periodically used to house government staff and contractors working at the nearby immigration detention centre. The community's requests were declined by successive governments, most recently in 2021.
Decades of proposals, inquiries, and parliamentary committees have circled the same question: what do you do with a mothballed casino on one of the most remote islands in the Indian Ocean? In 2025, the Australian government took a concrete step, issuing an approach to market for a property management agency to inspect and list the 18-hectare beachfront site. Hotels and Hospitality Group, part of JLL, was appointed as property manager and visited the island in October 2025 to begin the process. The government's language shifted from gambling to eco-tourism -- expressions of interest are now sought for ventures aligned with the island's natural and cultural values, including luxury adventure experiences, short-stay accommodation, and eco-tourism operations subject to environmental regulation. The adjacent marine park and surrounding ecosystems, which include the island's famous red crab migration routes, add both value and constraint to any redevelopment.
From the air, the resort complex is visible as a geometric scar on the northeastern terraces, surrounded by the dense tropical rainforest that covers most of Christmas Island. The runway at Christmas Island Airport lies nearby, a reminder that this was always a place designed for arrivals. Whether those arrivals will ever again be tourists rather than government contractors remains an open question. The resort has been empty longer than most of its potential guests have been alive, and the Indian Ocean continues to break against the cliffs below Waterfall Bay with the same indifference it showed when the slot machines were spinning.
Located at 10.46°S, 105.71°E on the northeastern coast of Christmas Island, an Australian external territory in the Indian Ocean. The resort complex is visible on the coastal terraces at Waterfall Bay, near Christmas Island Airport (YPXM). The island sits approximately 380 km south of Java and 1,600 km northwest of mainland Australia. Best viewed from 3,000-5,000 ft AGL approaching from the northeast. The island's dramatic cliffs and dense rainforest canopy make it visually distinctive from altitude.